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Alphabet’s Latest Urban Bet: Underwriting Infrastructure

Alphabet has for years promised to be a leader in urban innovation. Its latest initiative is old school: infrastructure finance.

The company told The Wall Street Journal on Thursday that it had spun up a company called Sidewalk Infrastructure Partners, or SIP, to help “modernize aging urban systems” by making investments in roadways that use a new startup’s technology, for instance. The story didn’t note the size of the fund, but said it would use money from Alphabet, its subsidiary Sidewalk Labs and Ontario Teachers’ Pension Plan. It will target projects that require over $100 million in equity.

The new company is an outgrowth of Sidewalk Labs, the other Alphabet subsidiary trying to develop a new neighborhood in Toronto. That project, mired in local politics, is still waiting for various government approvals to move forward. 

If Alphabet can’t get the politics of urban development right, they just might make money on the financing. Traditional infrastructure financing models don’t anticipate new technology, SIP executives told The Journal. 

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